If you are thinking about starting your own company, then you may be curious to see why so many businesses fail in the early days.
Unfortunately, the main thing that you have to remember is that business failure is very common. 20% of small companies tend to fail within the first year.
When you look at the long-term success rate, you will see that around 96% of companies fail within the first 10 years. The other 4% might not have succeeded either. This statistic just means that they have been able to survive.
If you want your company to be one of the few that are left standing then you need to make sure that you look into the various reasons why companies falter, so you can take steps to make sure that you do not succumb to the same fate.
Not Having a Good Business Plan
If you do not have a good business plan, then you will not be able to communicate your vision to the rest of your team. You have to make sure that you do not just have a business plan.
You need to make sure that you have a complete map so you can take your company to that next level. Explosive growth can be tempting but at the end of the day, if you do not scale in an effective manner, then this will work against you.
You have to make sure that you have the right level of growth, and you also need to know what is holding you back.
Not Putting your Customer First
One of the main reasons why so many companies fail is because they happen to fall in love with the product and not with the customer. This is a crucial mistake, and you need to avoid it where possible.
You have to make sure that you fall in love with your client, and you also need to figure out what they want and what they need. It is also important for you to turn any customers that you do have into raving fans. You need someone who is going to advocate for your service or your product.
When you are able to grasp the concept that your customer’s life is also the key to your business’s life, you will find it easier than ever to succeed.
Not Hiring the Right People
Hiring the best people will come with obvious benefits and it will have a huge impact on the rest of your company.
One of the main examples here would be sales. If you do not have enough sales, then you cannot hope to pay your team or even yourself, and this will limit your growth. Confident salespeople are the key here. If you want to do something about this, then it is a good idea for you to use inventory management software.
When you do, you will soon find that it is easier than ever for you to get the results you need, and this can work in your favor.
Going at it Alone
Sure, you may well be an entrepreneur, but this doesn’t mean that you have to try and take care of everything by yourself.
A business is only ever as strong as its leader. You have to make sure that you can let go and that you can put your trust in others. If you feel the constant need to control everything then you will probably have a hard time succeeding over the long run. Delegating is a huge skill, and it is crucial if you want to run your company properly.
If you want to help yourself then it is important to hire the right professional help too. It may be that you seek legal advice to mitigate commercial risk or that you hire an accountant to do your books. Either way, if you can keep things like this in mind, it’ll help you in the long run.
You Lack Flexibility
Remember shops such as Radio Shack, or Blockbuster? They were once giants in their industry, but they fell victim to a huge mistake.
They did not adapt to the changing market, and this worked against them all. Business owners who do not adapt or who refuse to change directions when the market calls for it will probably fail.
Lack of Innovation
You have to be innovative. Innovative means you coming up with new or interesting solutions that help you to meet the needs of your clients.
If you want to become successful or if you want to sustain the success that you have experienced, then you need to find a way to add more value when compared to everyone else.
If you can do this, then you will soon find that your chances of success increase dramatically.
Not Knowing Your Industry
Believe it or not, this is a huge driving factor behind why a lot of businesses fail. There are certain industries out there that will require you to be more innovative and a lot of this comes down to product cycles.
Consider the tech that is available too. People expect you to take advantage of both innovation and improvement. If you cannot deliver this or if you cannot meet client expectations, then you know that someone else will. We live in a very different world and if you are not staying ahead then you are certainly going to end up falling behind.
This is the last thing you want, as it could easily result in failure. By being innovative and by trying to stay ahead, you can then make sure that you don’t end up falling victim to this mistake, which is the reason why so many companies end up failing.
Fear
If you ask any entrepreneur what their main fear is, then there is a high chance that they will say failure. If you weren’t worried about failure, then there is a high chance that you wouldn’t be reading this post.
If you want to develop your entrepreneurial skills, then you need to try and overcome this. You should see situations as learning opportunities and not as something that should be avoided.
If you can do this, then you will soon find that you can increase your growth potential by a great deal.
You have the Wrong Mindset
Your mindset will determine the results you get. If you are an entrepreneur, then you have to make sure that you embrace strategies. This will help you to turn your business failure into a success.
When you feel empowered, you may feel as though the world is your oyster and that you are just getting started. Never let your limiting beliefs take away from the power you have, and always stay hungry when you are searching for success.
If you can make sure that you do this, then you will soon find that you can achieve a lot of success in the future.
You Lack Vision
Do not adapt your business to meet the needs of the economy. Instead, try and keep on track with the vision that you once had.
This will help to stop you from straying to a business model that is not as efficient. You need to try and do this independently of the circumstances you are trying to deal with.
If you can stay loyal to your vision, then this will help you to achieve everything you have ever wanted and more.
You Lack Passion
If you can adopt a passion-driven mindset, then this will help you to persist when it comes to honing your ethics and it will also help you to avoid failure. If you stick with what you love then this will help you to see the circumstances you are working within, much clearer.
If you can adopt this level of focus, then you will soon see that it is more than possible for you to create an unstoppable drive so you can accomplish your goals with ease.
This level of focus allows you to take more risks and it also helps you to acknowledge the feelings that you are experiencing. Remember that the feeling of failure or doom will not stem from taking risks.
It will come from the feeling of being stuck and not progressing. One way for you to avoid this would be for you to avoid being stuck, and instead, persist as much as possible with your dreams.
Poor Marketing
It doesn’t matter if your company is big or small because marketing is a critical step.
If you cannot find a way to truly market your service or product, then your business will have a hard time getting off the ground. The main reason for this is because even if your product is the best around because if people don’t see it as being as good as it is, then this will work against you.
Take a look at McDonalds for example. Do you really think they have the best burgers around? Absolutely not.
That being said, they are convenient, and their marketing campaign is top-notch.